Group Buying Supplies for Restaurant

[jklondon]

I am investor in a restaurant, they were looking around for group buying networks where they could combine their demand or supplies say coke (the drink!) with other buyers so they could leverage the negotiation power of a larger buyer to get the per-unit costs down. Do such groups exist in the UK for B2Bs?

Thanks JK

 

[Vicarious]

I came across one 'Seymour Direct' at least thats how they described themselves but not in your field anyway.

Years since I bought it but the Hotel and Caterer must be trusty as ever

 

[truereddevil]

Who thinks the idea of buying groups is interesting and how would you go about finding them. I would be interested in joining a group that deals with packaging supplies

 

[oldeagleeye]

Forget buying groups. Half a dozen restaraunt owners are not going to influence a major play like Coke or Sweepes and the whole concept falls down on distribution anyway.

The group for example would have to have it's own distribution depot and there is no way that any extra discount would cover those costs.

I might add the restaraunt biz these days anyway is not about cutting costs it is about sourcing quality produicts and charging a premium and that is fast becoming the biz model for most supermarkets too.

Rob

 

[patientlady]

You will pay more if you buy through a buying group! Trust me...

 

[Billmccallum]

On promotional offers, Tesco, Asda, Morrisons, etc, can sell drinks at lower cost than wholesalers. I know of several shops and take aways that use Tesco for their drinks on a regular basis.

 

[jklondon]

Thanks so far, told him to build a group up with others he knows in the industry and build a simple model in spreadsheet to see if they could actually make it worth their while buying in bulk with the wholesaler, think its worth exploring at least.

 

[Drpepper]

When you can buy your example of a can of coke for 23p wholesale there isn't a great deal that can be further discounted unless you are buying 10,000's, as such you would need a pretty large buying group to better the wholesalers prices.

 

[oldeagleeye]

The point is it is NOT worth exlporing. Who is going to do the negociating for instance your guy. Yea right he is going to spend all his spare time on it so that everyone else benefits without putting in a bean.

Then take it further. He gets 10% off a dozen eggs if he buys in bulk. Is he going to deliver the other 100 dozen because the only way he can get that discount is buying and having delivered in bulk. Of course not so the other members of the group would need to spend time on collecting and for what. To save 50p on a couple of dozen eggs being their quota.

Get real - and I told you earlier. Sourcing is a key element in a restaraunt. If your guy gets his organic great vegs from a local grower he is not going to want to share that supplier with others - there simply wouldn't be enough to go round.

Frankly OP I would suggest that you tell your restaranteur to spend any spare time he has on sourcing the best for himself and then keeping those suppliers to himself. Either that or introducing new receipes and not wasting his time on setting up or getting involved in buying groups.

They are a waste of time because they are only in the business to make money for themselves in the short term. It doesn't take long to find out that there are no real benefits to members.

Rob

 

[jklondon]

The point is it is NOT worth exlporing. Who is going to do the negociating for instance your guy. Yea right he is going to spend all his spare time on it so that everyone else benefits without putting in a bean.

Then take it further. He gets 10% off a dozen eggs if he buys in bulk. Is he going to deliver the other 100 dozen because the only way he can get that discount is buying and having delivered in bulk. Of course not so the other members of the group would need to spend time on collecting and for what. To save 50p on a couple of dozen eggs being their quota.

Get real - and I told you earlier. Sourcing is a key element in a restaraunt. If your guy gets his organic great vegs from a local grower he is not going to want to share that supplier with others - there simply wouldn't be enough to go round.

Frankly OP I would suggest that you tell your restaranteur to spend any spare time he has on sourcing the best for himself and then keeping those suppliers to himself. Either that or introducing new receipes and not wasting his time on setting up or getting involved in buying groups.

They are a waste of time because they are only in the business to make money for themselves in the short term. It doesn't take long to find out that there are no real benefits to members.

Rob

Disagree, economies of scale can work the question is what threshold of orders for a product that needs to be crossed to make it worthwhile. If it works and he can save money for others then he could easily take a cut. The cost of exploring this is a few hours work given that he already got a list of weekly supplies for basic goods from 15 restaurants today, clearly they are open to saving money as they took the time to produce this. Thanks for the advice anyway, I think.

 

[oldeagleeye]

Sorry JK . You are living in cloud cuccko land. As I and other members have pointed out there are no huge discounts even if you were to spend a £1 million quid a week because the distribution costs would far exceed that.

What I rather suspect is happening here is that your investment in this restaraunt is going down the pan and you are clutching at straws. It is therefore patently obvious that you know nothing about the restaraunt industry. It is NOT about saving a few pence on eggs or coke as I said before or any sort of volume business.

It is all about speciality at a premium and personality to boot. You cant replace that with an amateuer buyer let alone an accountant.

All in all it seems to me that you have lost your investment anyway given your blindness to the facts of life. I mean how to you fancy this for a promotion let alone see how the punters would see it.

Forget the guy down the road offering organic and farmfresh produce and great mouth watering and healthy receipes and the like. Come to us instead we can offer you battery eggs and cheap coke instead and the food is crap because our chef spends most his time trying to sqeeze pennies out of suppliers in our buying group.

Now I am not going to say how stupid can get. May I suggest however that you put your business plan and marketing strategy in front of the Dragons Den. They are looking for entertainment value.

Rob

 

[Liybpg]

I'm sure this can work for mcdonalds type 'restaurant'

 

[jklondon]

Sorry JK . You are living in cloud cuccko land. As I and other members have pointed out there are no huge discounts even if you were to spend a £1 million quid a week because the distribution costs would far exceed that.

What I rather suspect is happening here is that your investment in this restaraunt is going down the pan and you are clutching at straws. It is therefore patently obvious that you know nothing about the restaraunt industry. It is NOT about saving a few pence on eggs or coke as I said before or any sort of volume business.

It is all about speciality at a premium and personality to boot. You cant replace that with an amateuer buyer let alone an accountant.

All in all it seems to me that you have lost your investment anyway given your blindness to the facts of life. I mean how to you fancy this for a promotion let alone see how the punters would see it.

Forget the guy down the road offering organic and farmfresh produce and great mouth watering and healthy receipes and the like. Come to us instead we can offer you battery eggs and cheap coke instead and the food is crap because our chef spends most his time trying to sqeeze pennies out of suppliers in our buying group.

Now I am not going to say how stupid can get. May I suggest however that you put your business plan and marketing strategy in front of the Dragons Den. They are looking for entertainment value.

Rob

Rob I am just embarrassed for you, I pity the guys you mentor.

 

[patientlady]

If you become part of a buying group you will need to sign an agreement and adhere to it whatever the conditions.
If you are free to buy from wherere why would you wish to give up that freedom? A buying group will offer you products that they have in stock not neccasarily what you wish to buy!
The only sector that is making any sort of money in this climate is quality high end restaurants.
Quality drinks, quality produce, quality service with a quality chef

 

[jklondon]

If you become part of a buying group you will need to sign an agreement and adhere to it whatever the conditions.
If you are free to buy from wherere why would you wish to give up that freedom? A buying group will offer you products that they have in stock not neccasarily what you wish to buy!
The only sector that is making any sort of money in this climate is quality high end restaurants.
Quality drinks, quality produce, quality service with a quality chef

Diet Coke is Diet Coke no!

When I say restaurant I am not talking about gourmet here, perhaps I should have qualified that, its fast fresh food for city workers where cost management is key. They have already today implemented a scheme with a two establishments on the same street with a new supplier that would not have taken them individually due to their small sizes. Its only for soft drinks but they are making a reasonable if small saving especially on the 'premium' drinks.

So ...it CAN and DOES work... hopefully others looking to do something similar are not deterred from trying.